The flower economy rises rapidly amid women's consumption upgrade
As people's income levels rise, quality of life and lifestyle concepts deepen further, and consumption has extended from basic necessities of clothing, food, housing and transport toward spiritual pursuits. Among the many products of consumption upgrading, fresh flowers are highly popular for their ornamental value and captivating fragrance. Especially in the era of the female-dominated "she economy," a transformation of the "flower economy" has been set off in the mainland, and the daily fresh flower market, as a life adjustment product, has risen rapidly.
According to National Bureau of Statistics data, from 2012 to 2016 the per capita disposable income of mainland residents grew from 16,511 yuan (RMB, same below) to 23,821 yuan, with an annual growth rate stable above 6%. This income level has gradually rooted the pursuit of a high-quality lifestyle in people's hearts. Taking fresh flowers as an example, from 2011 to 2015 the mainland flower retail market flourished with robust growth momentum.
Market size grows year by year
In addition, the flower retail turnover of mainland commodity trading markets with turnover above 100 million yuan maintained a year-by-year growth trend, from 1.26 billion yuan in 2011 to 1.91 billion yuan in 2015. And according to data from the Alibaba Agricultural Products E-commerce White Paper, from 2014 to 2015 the sales of fresh flowers, green plants and gardening categories on Alibaba's retail platform grew by more than 93%.
It is worth mentioning that the growth of retail sales and the increase in online penetration further promoted the birth and development of a new fresh flower consumption market.
According to the "2016 National Flower Production and Sales Situation Analysis Report" released by the China Flower Association, in 2015 mainland flower consumption shifted from group consumption and holiday consumption to mass consumption and daily consumption. In 2016, the cut flower market trend was generally positive, the proportion of high-quality flowers continued to grow, and more and more new and superior varieties entered the market. Cut flower consumption continued to spread from first- and second-tier cities to third- and fourth-tier cities, and extended from ceremonial consumption and wedding consumption to household consumption.
Among the consumer groups of the flower economy, women have naturally become the main force. In the view of Su Chunzi, brand partner of flowerplus, women have always had personalized pursuits in consumption that differ from men's, and as women's economic capacity and social status continue to rise, "she economy" consumption is a market that cannot be ignored today. "Moreover, the inherent attributes of fresh flowers determine that they are bound to become a high-frequency consumer product for women." Taking flowerplus's user group as an example, more than 90% are women, and the core user group is female white-collar workers aged 25 to 38 with a monthly income above 8,000 yuan, that is, the user group now called the "new middle class."
Traditional business formats have drawbacks
iResearch pointed out that in the traditional operating model of the fresh flower industry, due to poor information flow between supply and demand sides, when demand is large during periods such as holidays, upstream growers, limited by conditions, find it hard to keep up with supply, and fresh flower cultivation is easily affected by environmental factors such as seasons, making output and quality unstable.
At the same time, during the transport of fresh flowers there is the phenomenon of compression-style packaging, resulting in an excessively high damage rate. In contrast, downstream flower shop sales suffer from drawbacks such as a single product offering and cannot meet users' diverse needs.
In addition, in the sales process of the traditional fresh flower industry, products circulate through layer after layer. From flower farmers growing flowers to final consumers buying flowers, the flowers must pass through multiple intermediate links such as the primary market, the secondary market and physical flower shops, which not only increases the risk of quality damage to fresh flowers during transfer, but also means that the multi-level markups in between must be paid for by consumers.
With the rise of social media such as WeChat, major changes have taken place in traditional industry formats. With the help of the WeChat platform, sales staff can transmit product information more quickly and serve more efficiently, and consumer groups can more easily obtain all kinds of flower information. Exquisite pictures and targeted information make flower consumption more pervasive in terms of guiding life applications, highlighting personality and shifting concepts.
Varieties are constantly innovated
Against this background, around 2015, e-commerce platforms that seized on the "flower economy," such as The Beast, flowerplus and Huadian Shijian, launched one after another, and their products quickly gained consumer recognition and promotion. The B2B and B2C models made demand more precise, which not only promoted healthier development of the fresh flower industry chain but also greatly reduced costs for all parties. Taking Yunnan, China's fresh flower production region, as an example, in 2015 the fresh flower production area showed restorative growth, reaching 186,000 mu, with output of 8.69 billion stems.
Not only that, China's fresh flower production is still dominated by roses, lilies, carnations, gerbera daisies and baby's breath, and new varieties are constantly being introduced to the market. As market demand for new varieties grows, the maturity period for new varieties to enter the market is also shortening. Varieties that once took two to three years to bring to market now take only a little over a year.